Why I'm Worried About My Friends' "Successful" Acquisitions

Real talk from a technical founder building AI-powered businesses

Published September 12, 2025 • Based on Founder Reality Episode 16

Also available on: Apple Podcasts • Spotify • YouTube

Another founder friend's startup just got acquired. Great news, right? I should be celebrating. But I'm not - I'm worried.

In the past two months, two of my friends have announced acquisitions. Over the past two years, it's been four or five. All labeled "successful acquisitions." All with one glaring omission: no price disclosed.

When Superhuman got acquired by Grammarly, no numbers. When my friend who told me just last week that "revenue is going to quadruple" suddenly announced his acquisition, no numbers. Compare that to OpenAI buying a hardware startup for $1 billion - that number got announced immediately.

Here's what I've learned: when acquisition prices aren't disclosed, it's usually not good news for founders.

The Brutal Math of "Successful" Acquisitions

Let's run the numbers on a typical scenario. Your company gets acquired for $5 million - sounds decent, right? But you raised $3 million over multiple rounds with liquidation preferences. Here's what actually happens:

• VCs get their $3 million back first
• $2 million left to split
• If you own 50% after dilution (which is generous), you get $1 million
• After taxes, you walk away with $500-600K

After working 3-4 years building a company, these founders - who could have made more money taking senior engineering jobs at Google - end up with less than they would have earned in traditional employment.

The Free Money Era is Over

The founders I know raised during 2020-2021 at 10-50x revenue multiples. That era is dead. I haven't seen funding round announcements on LinkedIn in 2-3 years. Back then, every time I refreshed LinkedIn, someone was raising $6-15 million seed rounds.

These companies that raised at crazy valuations can't raise follow-on rounds. They're facing reality: get acquired for whatever they can get, or shut down.

The brutal part? Many pivoted multiple times trying to find product-market fit, but having VCs on the board made it nearly impossible to move fast enough. When we pivoted SimpleDirect recently (check out our new website at getsimpledirect.com), we did it quickly because we don't have investors blocking us.

Why Bootstrap Companies Have the Advantage

This is validation for the bootstrap approach I've taken with both ANC and SimpleDirect. Not because I'm successful - I don't consider myself successful yet - but because the bootstrap mentality of "we don't exit, we compound" is proving right.

Look at Basecamp vs. Asana:

• Basecamp: Founded 1999, profitable since day one, 60 employees, $280 million revenue in 2024
• Asana: Public company, $3 billion market cap (down 32% this year), 1,819 employees

Which founders have more control? Which business generates more revenue per employee? The Basecamp founders split a lot of that $280 million and have total control. Asana's founders own tiny percentages of a company that might go bankrupt.

The Energy Cost of Starting Over

Here's what really worries me about my friends: they're now in their thirties, and they have to start over. Five years building a company, 6-12 months raising another round, 3-6 months in acquisition talks - all for an exit that pays less than they hoped.

I recently went through a brief period thinking I might have to start over with SimpleDirect, and it felt crushing. The thought of rebuilding everything after five years was demotivating. That's probably what many of these founders feel right now.

The New Playbook for 2025 and Beyond

If you're building now, here's what I believe works:

1. Build for Actual Profitability from Day One Not "path to profitability" - actual profit. When markets get tough, profit is the only thing that matters.

2. Keep Your Team Small and Efficient Companies getting acquired right now all have the same problem: they scaled headcount faster than revenue.

3. Build for Control, Not Growth Better to own 100% of a $5 million company than 20% of a $25 million company. You might get voted out of the 20% scenario.

4. Think in Decades Don't follow trends or think in quarters. Have a real moat and roadmap. I have roadmaps for running SimpleDirect and ANC for decades, just like Warren Buffett runs Berkshire.

Why I'll Never Exit

I never think about exiting. If I ever have to exit ANC or SimpleDirect, it's because something went wrong - I got fired or lost hope. If these companies work, I want to run them for the rest of my life.

With bootstrapping, you don't have to start over. Every month builds on what I built last month. That consistency and compounding advantage is something you can't get when you're playing the VC game and moving according to market forces.

We have 4-5 years of runway in the bank because we don't burn much cash. Compare that to Asana burning massive amounts monthly with 1,800+ employees.

The Questions You Should Ask

If you're building right now:

• Can I do this with a smaller team?
• Am I building for exits or thinking in decades?
• What happens if I can't raise another round?
• Do I actually need outside capital?

If you're thinking about starting a company, consider the bootstrap path seriously. You don't want to start over every few years because market conditions changed through no fault of your own.

A Different Kind of Success

I'm genuinely happy for my friends who got acquired. I hope their deals were better than I fear. But I've watched too many talented founders essentially work for free for years when they could have had better opportunities and work-life balance elsewhere.

There has to be a better way. I believe that way is building profitable, controlled, and compounding businesses that you hopefully never have to exit unless you choose to.

While my friends restart their entrepreneurial journey at 30, I'm building on the foundations I laid months and years ago. That consistency is the real advantage of the bootstrap path.

If you're a bootstrap founder navigating similar market dynamics, I'd love to hear from you. The compound growth mindset beats the exit-and-restart cycle every time.

George Pu builds AI-powered businesses at SimpleDirect and ANC. Follow along for unfiltered founder insights at @TheGeorgePu.